The protagonist is really the only frame of reference that we have to address the issue of Anglo- Indian perception in Kipling's work.  Lispeth views Indians as a secondary reality.  She believes that her primary identity is in the Anglo part of her notion of self.  In being baptized and educated in the Anglo way, she constructs her identity in accordance to being Anglo in India.  When she recognizes the betrayal that the English show to her, she understands that she will always be on the outside.  No matter how hard the Anglo- Indians seek to embrace the Anglo element of their identity, Kipling seems to be suggesting that they will always be "Indians."  It is for this reason that Lispeth goes away, becomes "Indian" and embraces Taraka Devi as her deity and moves every way possible in order to avoid the Anglo conception she used to be. 

In terms of how Indians view Anglo- Indians, consider how Lispeth is treated once married to an Indian.  She is beaten and abused, almost symbolic of how the Anglo- Indians are reduced to banality by the Indians.  The feeling of superiority and the sense of self that the Anglo- Indians once experienced has to be beaten out of them.  The fact that Lispeth is abused and ends up decaying with age is a statement that reflects the tension intrinsic to how the Indians view the Anglo- Indians.  In this, there is a sense that the Anglo- Indian experiences betrayal on all ends, reason enough why Lispeth suffers so.